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The Basic Problem with Using a Ranking Method for Performance

question 48

True/False

The basic problem with using a ranking method for performance appraisals is not identifying the extreme good and bad performers but differentiating meaningfully between the others.


Definitions:

Equipment

Tangible assets used in the operation of a business, but not intended for resale.

Prepaid Rent Expense

An asset account that represents payments made for rent in advance of the rental period, which will be expensed over time as the rental period occurs.

Assets

Resources owned or controlled by a business, expected to produce future economic benefits.

Expenses

Costs incurred in the process of earning revenue; examples include rent, utilities, and salaries.

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